Agreement reached on Vermont Yankee tax

(Host) Negotiators in the Statehouse have reached an agreement on a way to tax the Vermont Yankee nuclear plant to pay for energy conservation programs.

But the Douglas Administration remains strongly opposed to the tax and several other provisions in global warming bill.

VPR’s John Dillon repots:

(Dillon) The plan is to tax the power generated by Vermont Yankee and use the money to make homes and businesses more energy efficient.

The efficiency programs are a key part of a global warming bill advanced by both the House and the Senate.

House Speaker Gaye Symington says the tax is a fair way to raise money for a program that she says will reduce greenhouse gas emissions and save Vermonters’ money. She says the tax proposal puts wind energy projects and nuclear energy on an equal footing.

(Symington) “Basically what we’re trying to do is approach this and say let’s not treat Yankee any different, but perhaps we should move away from the favorable treatment that they’re currently clearly getting in paying the rate that they are, the generating tax. The first step is to say let’s follow this mantra of treating Vermont Yankee the way we treat other producers of electricity.”

(Dillon) But Yankee is adamantly opposed to the tax. The company says the new burden of taxation will increase its cost of doing business, and that it may have to charge more for power if the plant is relicensed after 2012.

Brian Cosgrove is a Yankee spokesman.

(Cosgrove) “It’s accurate to say it will raise electric rates in the future, because it’s the unpredictability factor that makes it more difficult.”

(Dillon) And the Douglas Administration says the tax sends a chilling message to business. Public Service David O’Brien runs the state agency that represents ratepayers.

(O’Brien) “The implications of this tax, were it to succeed, would cost consumers money, will absolutely affect any discussions about power supply with Yankee on a going forward basis.”

(Dillon) But Representative Shap Smith, a Morristown Democrat, says Yankee paid less into the state Education Fund this year than it did seven years ago. During a meeting on the tax issue, Smith put this question to Yankee’s lobbyist.

(Smith) “Do you know of another property in Vermont where if it’s more valuable it pays less taxes to the Education Fund?”

(Dillon) Although lawmakers have agreed on the global warming bill, it’s unlikely that Governor Jim Douglas will sign the legislation. He’s strongly opposed to the Yankee tax.

And his administration delivered a letter to Speaker Symington on Wednesday that lists several other parts of the bill that the governor opposes.

The bill creates a new energy efficiency fund, and the administration says the legislature should exhaust other alternatives before it creates a new program that could cost an additional $15 million a year.